Rep. Ashley Hudson, a Little Rock Democrat, speaks on the floor of the Arkansas House on May 5, 2026. | Arkansas Advocate photo by Tess Vrbin
By ANTOINETTE GRAJEDA | Arkansas Advocate
Arkansas legislators gave final approval to another round of income tax cuts Wednesday morning, concluding a three-day special session.
Gov. Sarah Huckabee Sanders is scheduled to sign the tax cuts into law this afternoon. This marks the fourth time the General Assembly has lowered income taxes since the Republican governor took office in 2023.
Sanders called lawmakers back into session to lower the top individual income tax rate from 3.9% to 3.7%, retroactive to Jan. 1 of this year. Legislators also reduced the top corporate income tax rate from 4.3% to 4.1% effective next year.
Finance officials say the cuts will cost the state nearly $192 million for the fiscal year that begins July 1 and nearly $145 million each fiscal year afterward.
The Arkansas House and Senate approved identical tax cut bills along party lines Wednesday. The legislation received a 27-6 vote in the Senate and a 79-18 vote in the House.
Their Democratic colleagues have argued high-earners and corporations will benefit from the tax cuts more than working families. They cited concerns about cutting state revenue as Arkansas faces uncertainty due to looming federal funding cuts.
They’ve also said money supporting tax cuts could be better used to address issues, such as food insecurity, early childhood education and rural healthcare.
Some Republican lawmakers, on the other hand, have argued returning the money to taxpayers is the best way to use the state’s money.
Arkansas Advocate is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.
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